investing out of state
Brandon MorganPro Member
Member since 2023 · 124 posts · 132 votesinvesting out of state
Most Popular Reply
Lender · Austin, TX · Member since 2021 · 447 posts · 441 votes
2yThe south is a pretty hot market, but it really depends on what your goals and strategy are. I'm seeing a lot of BRRRRs and AirBnBRRRs in FL. But the questions I would ask yourself before finding a market are: am I looking to prioritize cash flow, appreciation, or a mix of the two? What strategy am I looking to do: flip, BRRRR, LTR, STR, small multifamily, etc? Once you figure out the answers to these two questions, you can start to narrow down what markets make sense for you based on the FRED economic data: https://fred.stlouisfed.org/
43 Replies
- New to Real Estate · Fort Lauderdale · Member since 2024 · 19 posts · 7 votes2y
Quote from @Ray Hage:
NJ/NY is crazy expensive so I'm not surprised you're looking out of state. I am agent in Fort Lauderdale and invest here as well (mainly small MFs and a house hack). 50k is more than enough to get started. Is there a particular area of Florida you're considering? I can advise on south FL and get you into the right deal here.Quote from @Brandon Morgan:
hey all I am new to Real estate and have been trying to buy a property for the last 2 years but it is not working out. I live in the New Jersey New York area and prices continue to climb and they do not look like they are falling any time soon. Recently I have been thinking about investing out of the state . I have been thinking Florida or somewhere else down south could be a good idea. Does anyone have any experience or advise with this? I make a little over 100k a year and have 50k currently ready for a down payment. any insight would be helpful.
Hey ray I’m also in the Fort Lauderdale and would like some help going in the direction for a good deal if you don’t mind
- Member since 2023 · 124 posts · 132 votes2ygood strategy.
Quote from @Scott Schnabel:
You need good "boots on the ground". Build a team of people to help; an agent who isn't trying to talk you into every opportunity and knows how to analyze a deal; a lender who offers you all the possibilities; an inspection company that can get things done quickly; finally a property management company that comes with good referrals.
- 2yRobert EllisBusiness MemberDeveloper · Miami, FL · Member since 2014 · 3k+ posts · 1k+ votes
Quote from @Brandon Morgan:
hey all I am new to Real estate and have been trying to buy a property for the last 2 years but it is not working out. I live in the New Jersey New York area and prices continue to climb and they do not look like they are falling any time soon. Recently I have been thinking about investing out of the state . I have been thinking Florida or somewhere else down south could be a good idea. Does anyone have any experience or advise with this? I make a little over 100k a year and have 50k currently ready for a down payment. any insight would be helpful.
have you looked at new construction in South Florida? happy to discuss
Section 8 Launch52 Reviews - Investor · Fort Lauderdale, FL · Member since 2020 · 1k+ posts · 755 votes2yHow's it going? Sure what's your gameplan/goal(s)? I'll send you a PM
Quote from @Barrington Smith:
Quote from @Ray Hage:
NJ/NY is crazy expensive so I'm not surprised you're looking out of state. I am agent in Fort Lauderdale and invest here as well (mainly small MFs and a house hack). 50k is more than enough to get started. Is there a particular area of Florida you're considering? I can advise on south FL and get you into the right deal here.Quote from @Brandon Morgan:
hey all I am new to Real estate and have been trying to buy a property for the last 2 years but it is not working out. I live in the New Jersey New York area and prices continue to climb and they do not look like they are falling any time soon. Recently I have been thinking about investing out of the state . I have been thinking Florida or somewhere else down south could be a good idea. Does anyone have any experience or advise with this? I make a little over 100k a year and have 50k currently ready for a down payment. any insight would be helpful.
Hey ray I’m also in the Fort Lauderdale and would like some help going in the direction for a good deal if you don’t mind
- 2yAdrian Lammersdorf-SciollBusiness MemberRealtor · FL · Member since 2020 · 227 posts · 101 votes
The landlord laws are much favorable in Florida thats for sure. Appreciation is projected to be much greater as well so definitely a good decision in that sense. As far as what will work out is up to you. A strategy that I find a lot of investors, and myself are using more recently down here is finding a property that needs work since they can be sold a lot cheaper, and fixing them up so they can cash flow after being rented out.
With 50k you could get a hard money lender, and they will give you cash to buy, and also fix up the property. If you need some connections to a hard money lender I'd be glad to recommend some. I also know a good amount of contractors that can help out as well. There's a lot of sharks out there that charge way more than what it should cost.
Another strategy would be to go to areas that have much lower home cost, and good rental rates. I know a few investors doing really well that invest in Ohio, and cash flow really quickly. BP has a list of best rent to price ratio areas.
Thomas Lynne Realty527 Reviews - 2yJimmy LieuBusiness MemberReal Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
Quote from @Brandon Morgan:
hey all I am new to Real estate and have been trying to buy a property for the last 2 years but it is not working out. I live in the New Jersey New York area and prices continue to climb and they do not look like they are falling any time soon. Recently I have been thinking about investing out of the state . I have been thinking Florida or somewhere else down south could be a good idea. Does anyone have any experience or advise with this? I make a little over 100k a year and have 50k currently ready for a down payment. any insight would be helpful.
Hey Brandon, totally can relate with you being from an expensive real estate market - I moved to Columbus a few years ago (from Portland, Oregon which was super expensive) to become a full time real estate investor, and ever since, I've completed quite a lot of BRRRRs, flips, and own a successful rental portfolio here in Columbus Ohio. There's so many catalysts for population and job growth (Intel, Honda, Amazon, Nationwide Hospital, etc). I can definitely tell you there's still a lot of positive cash flowing and 1% rule deals and you get amazing appreciation. As an investor and agent here in Columbus Ohio, if you have any questions or want to connect, definitely reach out!
Jimmy Lieu, Red 1 Realty4.9120 Reviews - Real Estate Agent · Wichita, KS · Member since 2016 · 11 posts · 3 votes2yI am biased, but I love Wichita, KS. Check out this article from BP on our market for YOY Median Sales Price Growth!
Quote from @Brandon Morgan:
hey all I am new to Real estate and have been trying to buy a property for the last 2 years but it is not working out. I live in the New Jersey New York area and prices continue to climb and they do not look like they are falling any time soon. Recently I have been thinking about investing out of the state . I have been thinking Florida or somewhere else down south could be a good idea. Does anyone have any experience or advise with this? I make a little over 100k a year and have 50k currently ready for a down payment. any insight would be helpful.
https://www.biggerpockets.com/blog/where-home-prices-grew-th... - Member since 2020 · 3 posts · 2 votes2y
Quote from @Tanner Lewis:
The south is a pretty hot market, but it really depends on what your goals and strategy are. I'm seeing a lot of BRRRRs and AirBnBRRRs in FL. But the questions I would ask yourself before finding a market are: am I looking to prioritize cash flow, appreciation, or a mix of the two? What strategy am I looking to do: flip, BRRRR, LTR, STR, small multifamily, etc? Once you figure out the answers to these two questions, you can start to narrow down what markets make sense for you based on the FRED economic data: https://fred.stlouisfed.org/
Pls, can you explain with a practical analogy, how someone can use the FRED economic data to streamline their decision pertaining to what markets will make sense.
- 2yRyan PorterPro MemberReal Estate Broker · Jackson Ms · Member since 2019 · 35 posts · 26 votes
There is a lot of great advice here. I want to throw my thoughts in. I live and work as a broker in Mississippi and specialize in helping out-of-state investors. You can usually make money in rental homes in just about any decent-sized city in the Southeast: Birmingham, Alabama; Little Rock, Arkansas; Jackson, Mississippi; Atlanta, I could go on. What will decide if you will be profitable usually comes down to a few key things.
1. Get a good realtor who can provide accurate rental comps. "I recommend double-checking this with the property manager." Also, find out about the appreciation. Some areas appreciate up to $2000 a month, and some $100 a month. That's a big deal when you sell it in the future. Ensure your real estate agent knows you want a rent-ready home, the rental comps, and an appreciation report with every house they send you. Double-check everything.
2. Have a rock-solid property manager. One that will help with rental comps and review the home inspections with you before buying the home.
3. Have that good realtor negotiate any repairs so the home will be "rent-ready" at closing. Have the property manager inspect the repairs and confirm that the home is rent-ready.
Once you close on the home, there really should not be any surprises. The home should be ready to market, and you should know exactly what to expect in rent. Once the home is rented, everything will depend on the property manager. He will make you or break you. After renting the house, you should be pretty dead on with your Bigger Pockets Rental Calculator Report, which I hope you used before you went under contract.
The two biggest mistakes I see people make when investing out of state is trying to rehab a home and not doing home inspections. I strongly recommend NOT doing that. Either one. First off, trusting contractors from afar is hard. Even if your manager or realtor says they will help or oversee the repairs, just say no. Buy a rent-ready home. Invest that hard-earned money in a lovely home in an area that will appreciate. If you want to brrr a home or flip a house, do it locally so you can monitor everything closely. #fliplocal. The second is to always budget for an inspection and reinspection from a licensed inspector. Get the full report. It is not an "investor-friendly" report. You are investing a LOT of money. Find out everything you need to know about what you are buying.
I hope this helps; good luck with your first investment!
- Investor · Jackson, MS · Member since 2014 · 1k+ posts · 769 votes2y
You really can't count on properties appreciating in Jackson. I bought my properties towards the end of the Great Recession which Jackson was slow to recover from. It took until the pandemic for my properties to appreciate much. The good news is that the returns in rent were always enough to make it worthwhile.
- Lender · Austin, TX · Member since 2021 · 447 posts · 441 votes2y
Quote from @Antonio Na:
Quote from @Tanner Lewis:
The south is a pretty hot market, but it really depends on what your goals and strategy are. I'm seeing a lot of BRRRRs and AirBnBRRRs in FL. But the questions I would ask yourself before finding a market are: am I looking to prioritize cash flow, appreciation, or a mix of the two? What strategy am I looking to do: flip, BRRRR, LTR, STR, small multifamily, etc? Once you figure out the answers to these two questions, you can start to narrow down what markets make sense for you based on the FRED economic data: https://fred.stlouisfed.org/
Pls, can you explain with a practical analogy, how someone can use the FRED economic data to streamline their decision pertaining to what markets will make sense.
Look at market average income, changes in median home price, days on market. A lot of rental property investors look at markets with the median income compared to price to determine markets with strong rental revenue growth. There are numerous numbers you can look at but it really depends on what your investing goals are for.
- Real Estate Agent · Atlanta, GA · Member since 2020 · 414 posts · 233 votes2y
Hey Brandon - I'd try to get as scrappy as you can and try to get a house hack / live in flip if you don't already own your primary. I'd try to find something that needs some work and can rent well. You should be able to get into something with $50k down payment.
It's hard to justify investing in a lower cost of living market when you can house hack / live in flip in a higher cost of living area in most cases.
If you do own your primary, $50k will get you into a $200k investment property. Which is harder and harder to come buy in growing areas of the south. Happy to chat and help you through this decision - feel free to reach out!
- 2yWale LawalBusiness MemberReal Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
If local market circumstances are difficult for you, investing out of state may be a good option. In order to investigate this option, thoroughly investigate the market, establish investment criteria, assemble a local team of experts, investigate financing options, investigate potential properties with due diligence, and be mindful of potential risks like difficulties with remote management, market fluctuations, tenant turnover, and regulatory variances. To deal with any problems and safeguard your investment, create backup plans and risk-reduction techniques.
To learn about entity structuring possibilities for your investments, tax ramifications, and legal requirements, speak with legal and tax specialists. To offer asset protection and liability insulation, think about establishing a limited liability corporation (LLC) or other legal structures. You may harness possibilities in areas outside of your local area and perhaps obtain superior returns and portfolio diversity by adopting a methodical and strategic approach to out-of-state investment.
Good luck!
NETWORTH BUILDERS5236 Reviews - Investor · San Diego, CA · Member since 2024 · 77 posts · 54 votes2y
Hi Brandon! Congrats on finding your way to BP and to the real estate investing world! You are looking in the right direction if you are wanting to build long-term wealth for yourself. There is a lot of good info on this thread shared by other BP members. I determined from your initial post that you are looking to invest in a property vs buying one, rehabbing it and then renting it out yourself. There are a handful of turnkey companies that do all of this heavy lifting for you and present you with a fully renovated and rented property. If this is the route you are looking to take then let me know as I can help direct you to the reputable providers. Ryan Porter made some good points about the South East markets offering what you are looking for. Feel free to connect as I love helping new investors learn more about investing in real estate. Cheers!
- 2yLindsay DavisBusiness MemberReal Estate Broker · Birmingham, AL · Member since 2019 · 326 posts · 203 votes
Seconding @Ryan Porter here—there are plenty of properties to be had for a $50,000 down payment if you’re open to investing in the Sunbelt. There are plenty of affordable markets here—a place like Montgomery, Alabama is a particularly cheap market. Single-family homes in B/B+ neighborhoods go for around $100,000, so your $50,000 budget is more than enough to get started.
Do note, though, that Montgomery is better for cash flow. If you’re after appreciation (or a mix of the two), slightly pricier markets like Birmingham, Huntsville, or areas of southern Tennessee may be better options.
Spartan Invest4.8134 Reviews - Flipper/Rehabber · Columbus, OH (columbus oh) · Member since 2020 · 23 posts · 38 votes2y
Being from North Lake Tahoe, that is what we ended up doing. We tried several states and settled on Ohio. Relatively low barrier to entry, its a landlord friendly state, taxes aren't terrible and its one of the top 5 growing states in the country for industry. Intel just broke ground on the largest chip facility in the world which will also help.
- 2yGreg ParkerBusiness MemberRealtor, Contractor, Property Manager · Montgomery AL and Kowaliga, AL · Member since 2017 · 663 posts · 536 votes
I can answer any questions about Montgomery, Alabama.
MGM Property Pros LLC
Join the conversationCreate a free account to reply, vote on answers and follow this thread.